Question 1

At 4:49, I am 16 and I am trying to learn more about being financially savvy so I can be financially independent. What should I look out for as a teenager learning about Finances?

Accepted Answer

my biggest tip is to avoid debt at all costs. whenever it is possible, save up and pay cash. and really try to avoid student loans. if an 18 year old went to a car dealership with no steady income and asked to take out a loan for a car the salespeople would laugh in his face. and rightfully so. they know he won't be able to pay back the loan and they will lose money. but if the same 18 year old were to walk in to a college and ask for a student loan, guess what? he would get one. 70% of americans are in debt and live paycheck to paycheck. most of them started off their adult life in debt by taking out student loans. did you know that 6 months after you graduate college you have to start paying back your loans? the average student loan debt for a bachelor's degree is $34,100! that's a lot of debt, and most kids are about 23 years old once that debt starts catching up with them. what am i trying to say?
if you're like me and your parents aren't rich, you're gonna want to go for scholarships and grants and save as much as you can to avoid debt! the biggest factor that causes college students to drop out is student loan debt. sorry, i kinda went on a tangent, lol. i hope that helps!

oh yeah! 1 last thing. as soon as you turn 18 credit card companies will start bombarding you, trying to get you to sign up for a credit card. don't do it, unless you have a very thorough knowledge of exactly how they work. and even then, i encourage you to be different from the 70% of americans and live without ever using a credit card. it will be challenging, but hey, you will be thankful when you're older and the only one out of all your friends without any debt.

Question 2

I’m trying to save up for collage and I’m 13 how should I start?

Accepted Answer

As a 13-year-old, you may be starting to "save up for college" at a time when your resources are rather limited. You have a noble goal, but perhaps should have a conversation with your parents about what you're saving towards. If you aim to start now, and to save for your first year of college (which will likely begin when you're 18), you likely won't be able to save enough to pay your way through the first semester. SO, have a talk with your parents. If you choose a state college, you'll need about $30,000 for the first year. Break that down into so much for books, so much for tuition, so much for dorm space, so much for meals, and other parts. Then choose just one of those parts as your personal goal (books, cell phone, pizza... whatever). When you know the pieces, you and your parents can begin saving towards the goal, and you have 5 years to work on it.

So, you should start with gathering data and making a plan, and since you're only 13, you should make that plan in consultation with your parents, showing them how grown up you are already.

So, you should start with gathering data and making a plan, and since you're only 13, you should make that plan in consultation with your parents, showing them how grown up you are already.

Question 3

is it better to have cash or card? why

Accepted Answer

I note that you are in lesson one of Unit one.  Stick with the course. Your question will be answered in time.  You'll learn a lot more along the way.

Question 4

Is investing in the stock market included in this study?

Accepted Answer

Not directly.  This is not a course for people who are already well founded and funded enough to have something to invest. Most people, especially most Americans, never get that far.

Question 5

I'm gonna Assume 14 Isn't too young to start Financial literacy?

Accepted Answer

14 is a great age to start this course, which has 113 lessons.  You can finish them easily before your 15th birthday.

Charge!

Question 6

whats the difference between a debit card and credit card?

Accepted Answer

There's all kinds of stuff about that in Unit 3 of this course, but so you won't have to wait that long, here's the answer I give about once a week to learners around here.  
1. Credit cards and Debit cards are NOT the same thing.
2. If you have a debit card, the money that it represents must already be in your account before you can use it to spend.
3. If you have a credit card, you don't need to have the money first. You use the bank's money for making purchases. The bank charges you "rent" for using that money, and trusts you to pay the money itself, and the "rent" on the money, later.

Question 7

how can i avoid spending when i want to go out to eat

Accepted Answer

YOu can leave your credit or debit card at home and only take along enough cash to pay for a basic meal.

Question 8

How does college cost so much money? Is it partially because students are getting most of their lunches, and books from the college buildings?

Accepted Answer

Let's imagine that a college student continues to live at her parents' home, like she did in high school, and that her parents also pay for all her food, clothes, health insurance and transportation.  So, now we're down to college costing so much.

The college needs to pay teachers, all of whom studied for advanced degrees to get those jobs.  Teachers don't come cheap.

The college needs to pay for custodians, gardeners, secretaries, security guards, plumbers, electricians and other workers.  These people don't come cheap, either.

The college has to pay for a president and other managers who run the organization. These are professional managers who aren't there "just for the honor of it". They could get good pay in commerce or industry, so the college must pay them competitive salaries and benefits packages, too.

And the college needs to heat and cool its classrooms, offices and labs.

Labs need supplies. Those cost.

So, a college has a LOT of expenses. That's why it's expensive.

If you're willing to take your degree online from the University of the People or from Saylor.org, you can get through more cheaply.

Question 9

What is the average credit score?

Accepted Answer

Credit only matters if you do what everyone else does.  You create your own credit based on your level and consistency of integrity and how that affects your reputation.  People want to trick you into thinking that you NEED a bank, a broker, of some middle man.  You don't and if you do, you pay handsomely for that 'privilege'.  Learn to assess deals.  Learn to negotiate.  Learn to see with your mind rather than just your eyes.  Credit is for those who are average.  I have lousy credit; and yet I used problem solving skills to get past that, and I was financed by my internet company; because all they cared about was that I kept paying them on time for years.

Thus, I cut out several middle men, each one, who would take a cut off the top, costing me more in the long run.

It's good to learn about credit cards and how they impact your credit score; but unless our country devolves to a super socialist economy... like China... your credit score doesn't have to impact AT ALL your quality of living.  It's a lie, that's used to make us fall more and more into debt.  See through the lie, the guilt and shame that people in power try to heap upon your shoulders in order to keep you poor and a working slave; and you will have advanced quite far in your understanding of 'financial literacy'.

Course: Financial Literacy > Unit 1

What is financial literacy?

What is financial literacy?

Is financial literacy just about knowing how to budget?

Is it too late for me to become financially literate?

Do I need specific math skills to be financially literate?

Isn't financial literacy only important for people who make a lot of money?

Is it enough to just put my money in a savings account?

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